Bybit, one of the world’s largest crypto exchanges by trading volume, has launched options trading for Tether Gold (XAUT), a token backed by physical gold.

The new XAUT options are settled in USDT and allow traders to hedge exposure, speculate on gold price moves, trade volatility, and construct customized strategies using Bybit’s Request for Quote (RFQ) system for OTC execution.

To support liquidity from the outset, Bybit has partnered with crypto options market maker Orbit Markets. The firm brings extensive derivatives experience, including professionals from traditional finance backgrounds such as former executives at Deutsche Bank’s precious metals and FX desks.

“As tokenization accelerates, the boundary between crypto and traditional finance will continue to narrow,” said Jimmy Yang, co-founder of Orbit Markets. He added that gold options are a core pillar of traditional derivatives markets and noted growing interest in bringing such instruments into crypto.

The XAUT options are European-style contracts settled in USDT, with each contract representing one XAUT token, which is backed by one troy ounce of physical gold.

What are options?
Options are derivative contracts that give the buyer the right, but not the obligation, to buy or sell an asset at a fixed price within a specified time period. A call option allows the right to buy, while a put option allows the right to sell.

Put simply, options act like paying a premium to lock in a future price. If the market moves in your favor, you benefit; if not, you can let the contract expire and only lose the premium. They are commonly used for hedging or for trading volatility.

Market size
The global gold options market is a multi-billion-dollar industry dominated by exchanges such as CME and India’s MCX, with a large share of activity also occurring over the counter.

Bybit’s move brings this established derivatives market on-chain within a major crypto venue.

While XAUT options have previously been available on smaller platforms like CoinCall since November 2024, Bybit’s launch marks the first time a major top-tier exchange has offered them with institutional-grade liquidity support.